This week’s Millennial Think Tank broadcast focused on socialpreneurship, in particular looking at companies that include social impact as a core part of their business.

We found that the line between socialpreneurship and bigger brand operations / supply chains is actually quite blurred, and there were some interesting takes on what companies are responsible for, and what they’re expected to do when it comes to social impact.

You can watch or listen to the entire hangout below, or read the recap of the entire broadcast after the jump.

What is socialpreneurship?

We started off by defining socialpreneurship, and how it differs from social responsibility or other add-on programs in the “doing good” space.

Specifically, socialpreneurship is about looking at and changing how products are made / distributed, and assessing social impact as an investment return.

For example – a brand like Ten Thousand Villages has socialpreneurship as a core part of their business model. They empower individual producers globally by creating demand and ensuring fair pay for retail goods.

Is paying it forward important for you personally? What about in brands?

Tiffany noted that she does think about paying it forward, but when it comes to brands she draws a line between needs vs. wants.

If the product didn’t work as well as a leading brand, like Clorox, she’d be more likely to go for the product that she knew worked well / was familiar with – and cost was also a factor:

Let me take care of my basics, and then as I look at more of my elective decisions then I will take into consideration more of a company’s mission and history.

Judy provided a similar perspective, and noted that if pricing is reasonably comparable, she does take into account what a brand does to give back. She pays attention to things like wages and working conditions, and sees her purchases as an investment in businesses that are doing good things.

Other participants agreed, including Rachel who pointed out that “what’s on your mind as a consumer is that you just need a product that works, and fills a need…I think it is an afterthought that this company is also doing really good things.”

Hessie suggested that there is a higher consciousness of doing good than in the previous, and asked, why now? Why not before?

Jillian pointed to an overall cynicism re: government / authority, and said:

It’s a combination of more information and less of the atmosphere of business or government as citizen…it’s become super evident and clear / transparent that authority figures that we’ve grown up to trust are totally and incompletely and strictly not interested in the well being of human beings. So we are the ones who have to pick up that slack.

Judy felt there was a mental shift in generations compared to her parents, where you can’t trust that the majority is going to do what is right, and felt that Millennials take seriously the idea of living / exemplifying change in the world, particularly as consumers.

Hessie brought up that North America has lax standards for things like cosmetics and food, and the FDA bypasses social impact / safety on a regular basis.

A few participants dug into the FDA problem – including Samantha, who pointed out that corporations have a lot of leeway that came from being defined as having the same rights as individuals, and pointed out that things like human flesh at a very low level are considered acceptable in products.

Joe noted another example of charcoal used to filter food products that contains animal bones from mass production environments, and Hessie added that rat droppings are sometimes present in common products like peanut butter.

How much do you judge brands by things like food safety / supply chain safety?

Rachel and Jillian both said that they are critical of brands for problems across the supply chain, and Rachel pointed back to a split idea – noting that business operating in a transparent manner across their supply chain is different from just giving back:

If there are bad operations in a company I definitely do pay attention to that, because I don’t want my health to deteriorate, or if there is something unethical…as far as giving back, if a brand is going out of their way to do social good, that’s separate.

What if a company is called out for a problem and then fixes it?

Samantha mentioned the Tom’s Marketplace example, where the overall social impact comparative to the resources used was questioned, and wondered what people thought when a brand tries to reshape its’ efforts.

Joe brought up his experience with startups in the marketplace model, and asked if people liked the idea of platforms that enabled collaboration as opposed to those that just bought and sold goods/services directly.

Rachel responded that she felt the Tom’s model was a good one, but said “good intentions that don’t pan out correctly often loses loyalty from Millennials, and that it requires brands to be making a difference in the way that they say they can.”

She also pointed out that it’s difficult to assess how much social impact brands are truly having, and that while she’s in favor of the idea, she’d need more information to assess which are doing well.

This touched on a theme across the entire hangout – that Millennials seem to want to reward companies that have social impact as a part of their core business proposition, but don’t necessarily have time or easy enough visibility into whether companies actions/behaviors back up what they say about giving back.

How much they look into the social impact of a company also has a relationship to their perception of basic necessities vs. luxury items, and how much they can see the impact of their choices.

Joe brought up visibility, saying that “when you can see the impact that the thing that you’re doing has, I think it makes a difference,” and Rachel pointed back at the Tom’s example of good intentions being out of alignment with the actual effect, leading to a distrust of the brand.

Samantha liked that the marketplace model provides visibility into buyers and sellers, saying:

What the marketplace model is doing really well, is that you can actually see the people that you’re buying from, and you know already that they’re getting a fair wage for the product. It’s not the same as saying 10 cents of this purchase goes to a charity.

What about brands like Wal-Mart, where there is already a great deal of visibility into problems with core operations?

Jillian was highly critical of Wal-Mart – and suggested the model is one where the customer base consists of people who “know they should have better but just really can’t afford it. If you only have $50 to spend and you need to [fill] your house, you have to go there.”

She also approved of the Ten Thousand Villages model, because it contrasted in her mind with Wal-Mart where the supplier dominated what products are valued / priced at.

All of the participants were familiar with operations problems at Wal-Mart, including supply chain issues as well as the closer to home social impact on American workers.

Both Jillian and Tiffany pointed out that Wal-Mart is known for paying its’ employees as little as possible, to the point where wages aren’t liveable. Jillian also mentioned the undercut model, where Wal-Mart has such cheap goods that they can afford to underprice for a while to drive competition out of business.

Tiffany provided a sobering check, saying that realistically college students and other people she knows who are living paycheck-to-paycheck shop at Wal-Mart all the time, and that people tend to stick with habits they’ve had regardless of the social impact. She also questioned whether people who have those habits and like the low cost / ease of use would want to change.

Samantha asked if it would make a difference if a company made a guarantee of treating their employees fairly and providing livable wages – Tiffany felt that the two largest competitors, Target and Wal-Mart, purposefully didn’t point fingers because it was such a hot issue.

Where do you draw the line on cost / quality of product vs. the impact, good or bad, of its’ production has on the world?

Tiffany felt that many people take actions that are perceived as “doing good” but are more concerned with how they look than what’s happening with the core product. She questioned whether people who bought Tom’s shoes to begin with understood where they were coming from, or what impact they were having.

She also suggested that there is a problem with people who walk into an enterprise like Tom’s with the perspective of “I was told it was cool and this replaces me having to be more active instead of spending time researching anything” …a point that had all heads nodding in agreement.

Rachel added that she liked the Ten Thousand Villages model, and made a distinction between the cynical and idealistic parts of her perspective:

You can make ‘doing good’ lucrative. As a consumer I’m a little bit cynical anytime a good intention becomes lucrative without it actually panning out to be a god thing, but I think a model like Ten Thousand Villages is transparent, it’s a direct model where you’re buying things that help someone.

Samantha liked the personal impact / relationship aspect of Ten Thousand Villages as well, and that you could see who your money was going to, and Jillian noted that another example is Lush, whose packaging identifies the name / photo of the producer of every single item.

Transparency, transparency, transparency

Joe honed in on the idea of “what a company says its’ intentions are vs. what it’s actually doing” and noted that he doesn’t require a brand to be perfect, but needs to see that they are actively trying to improve their operations to account for social impact.

Hessie had heads nodding again when she pointed out that it’s up to consumers to assess the intentions of a brand, and whether that matches their actions…but that this can be difficult unless brands actively use marketing tools to show their impact.

Samantha brought up the example of Child’s Play – an organization that provides video games / equipment to hospitals, and wondered what would happen if brands were simply more honest about what they were doing e.g. “we are trying to make children’s lives better, but we aren’t able to control the supply chain for the equipment itself.”

Jillian pointed back to how the brand presents itself, and suggested that as long as the company actions match what it is saying it is doing it is hard to be critical.

Everyone responded positively to Samantha’s suggestion that if a company disclosed it was mostly doing good, but was also honest about its failings they would be willing to support it as long as the company was working to get better (outside of what Jillian noted are extreme issues, like the Ray Rice domestic violence case).

Overall, there seemed to be an interesting split in the way Millennials think of social impact.

The panelists this week were all critical of brands for negative social impact, particularly when there is an extreme example like Wal-Mart…but because of limited visibility into what brands are saying vs. what they are actually doing, and because of information overload, there were repeated moments that illustrate how hard it is for Millennials to rewards brands who do well vs. avoiding those that have bad core practices.

Joe is a product/ops guy working with the ArCompany team on content, growth, and analytics. He digs media, design, startups, data, rocanroll, anything science-y, and thinking about how to become a better human.